We finally saw the backtest we’ve been expecting as SPX fell a whopping 70 points (-1.47%), almost reaching its 10-day moving average and bleeding off its overbought condition.
ES came within a few points of our Fibonacci backtest, also coming up just short of its 10-DMA.
continued for members… (more…)
In a move that surprised no one, the BoJ left their monetary policy unchanged unhinged. The policy statement still reflects the looney tunes, magical thinking that has always epitomized their decisions: they’ll raise rates when inflation reaches 2% – even though inflation is well above 2% and has been for over a year. 
Annualizing the past quarter, CPI is running at 5.4%. Yet, the BoJ is holding short term rates at -0.10% and the 10Y at 0%. Ultra-low interest rates have exacerbated the inflation problem for consumers, as the yen continues to hover near 30+ year lows – driving food and energy prices even higher.
However, increasingly squeezed consumers remain at the bottom of the BoJ’s priority list, along with Debt:GDP – currently around 255%. At the top of the list: the Nikkei 225 stock index – hovering near all-time highs.
continued for members… (more…)
Futures are drifting higher as we approach the open, mostly on year-end positioning.
continued for members… (more…)
If Jay Powell’s comments were intended to spur the market to new highs, NY Fed President John Williams’ were intended to slow the roll. On CNBC this morning:
“We aren’t really talking about rate cuts right now…we’re very focused on the question in front of us, which as chair Powell said… is, have we gotten monetary policy to sufficiently restrictive stance in order to ensure the inflation comes back down to 2%? That’s the question in front of us.”
Futures were not amused, dropping from slightly higher to slightly lower as he spoke even though today is OPEX [see: Does OPEX Matter? (which desperately needs updating)].
continued for members… (more…)
CPI came in slightly hotter than expected at 0.1% versus 0.0% expected and prior (annual 3.1% vs 3.1%.) Core was 4.0% (unchanged) but 0.3% monthly versus 0.2% prior and 0.0% expected.) Core goods actually fell 0.3% while much stickier services rose a blistering 0.5%. This is all a bit of a disappointment for the rate cut crowd.
Futures are off slightly.
continued for members… (more…)
Futures are essentially flat ahead of tomorrow’s important CPI print.
continued for members… (more…)
Despite a much hotter than expected NFP print, VIX’s convenient collapse… 
…has once again convinced investors algos that there’s nothing to worry about. The 20-pt drop in futures following the print was erased within minutes.
It’s all in keeping with our year-end forecast, which remains unchanged.
continued for members... (more…)
Algos popped in the past hour on a larger than expected increase in initial jobless claims with the more important NFP due out tomorrow.
But, the more dramatic move has been in oil, with CL reaching our next downside target and RB well on its way to its own.
continued for members… (more…)
As noted yesterday, gold and silver reached our target ranges from mid-October. GC came up slightly short of its target from Oct 18 [see: Mideast Worries Mount]…
…before being aggressively hammered.
Silver nailed its target very precisely before meeting a similar fate. 
We’re faced with the usual questions after targets are reached: Was that it? Is it over? What’s next?
continued for members… (more…)
Futures are off moderately on the first trading day after what was a torrid November. Bears might take some comfort from the overbought Dow, which has reached Fibonacci and channel resistance.
continued for members… (more…)
